67% of business leaders are not convinced their companies will meet sustainability targets
Only a third (33%) of business leaders are confident that the targets their organisations have set to reduce their greenhouse emissions will be met, research from Efficio has revealed.
The procurement and supply chain consultancy’s recent Bridging The Gap report, which surveyed over 1000 C-suite leaders, senior business managers, and professionals working in procurement across the US, the UK, Germany, Italy, UAE, Saudi Arabia, and the Nordics, also found that 67% of business leaders agree that overpromising on sustainability-related goals is a major reputational risk to their organisation.
Efficio’s new report looks into the vital role procurement plays in addressing ESG issues, the current challenges procurement teams are facing, and which solutions they feel they can deliver to their businesses in meeting their strategic priorities.
Procurement teams have a long-standing remit to deliver cost benefit and ensure supply chain resilience. The findings from Efficio’s report highlight that while two of the top five strategic priorities for business leaders are ESG-focussed, traditional objectives remain the greatest focus – digital transformation remains the top priority for 49% of the business leaders. Among other critical objectives business leaders have to manage and prioritise, ESG continues to compete for limited resources in terms of time and money.
With the corporate landscape changing at a faster pace than ever before after more than two years of turmoil, organisations are reassessing all facets of their businesses. Over the last few years, a major part of ESG growth has been driven by the environmental component of ESG and responses to climate change. However, more recently, Russia’s invasion of Ukraine and the cumulative geopolitical, economic, and societal effects have also been influencing factors for ESG-based choices.
For business leaders to successfully achieve ESG targets, a change is required for consumers, businesses, and governments to come together – consumers to create the demand, businesses to innovate the solution, and governments to remove market barriers and inequalities.
Edward Cox, principal at Efficio, comments: “Sustainability has moved from being a nascent consideration to the mainstream. We are seeing greater scrutiny from consumers, financial markets, governments, and employees and this means businesses have had to strongly evaluate how they measure up against an array of ESG issues.
Encouragingly, ESG issues present a prime opportunity for businesses to foster innovation, increase worker productivity and loyalty and heighten corporate reputation. Procurement’s direction has shifted from absolute cost to total value, where sustainability is a key value lever.
We are delighted to share our latest research that uncovers market insight from both business leaders and procurement professionals about the changing nature of the corporate landscape, the magnitude of issues currently faced by procurement teams, and the challenges of implementing ESG strategy within the supply chain.”